No... You Do Not Need 20% Down to Buy NOW!

The Aspiring Home Buyers Profile from the National Association of Realtors (NAR) found that the American public is still somewhat confused about what is required to qualify for a home mortgage loan in today’s housing market. The results of the survey show that non-homeowners cite the main reason for not currently owning a home, as not being able to afford one.

This brings us to two major misconceptions that we want to address today.

1. Down Payment

NAR’s survey revealed that consumers overestimate the down payment funds needed to qualify for a home loan. According to the report, 39% of non-homeowners say they believe they need more than 20% for a down payment on a home purchase. In actuality, there are many loans written with a down payment of 3% or less.

Many renters may actually be able to enter the housing market sooner than they ever imagined with new programs that have emerged allowing less cash out of pocket.

2. FICO^® Scores

An Ipson survey revealed that 62% of respondents believe they need excellent credit to buy a home, with 43% thinking a “good credit score” is over 780. In actuality, the average FICO^® scores of approved conventional and FHA mortgages are much lower.

The average conventional loan closed in August had a credit score of 752, while FHA mortgages closed with a score of 683. The average across all loans closed in August was 724. The chart below shows the distribution of FICO^® Scores for all loans approved in August.

Bottom Line

If you are a prospective buyer who is ‘ready’ and ‘willing’ to act now, but are not sure if you are ‘able’ to, sit down with a professional who can help you understand your true options.

Should I Buy a Home Now? Or Wait Until Next Year? [INFOGRAPHIC]

Millionaire to Millennials: Buy a Home Now!

In a CNBC article, self-made millionaire David Bach explained that “the single biggest mistake millennials are making” is not purchasing a home because buying real estate is “an escalator to wealth.”

Bach went on to explain:

“If millennials don’t buy a home, their chances of actually having any wealth in this country are little to none. The average homeowner to this day is 38 times wealthier than a renter.”

In his bestselling book, “The Automatic Millionaire,” Bach does the math:

“As a renter, you can easily spend half a million dollars or more on rent over the years ($1,500 a month for 30 years comes to $540,000), and in the end wind up just where you started — owning nothing. Or you can buy a house and spend the same amount paying down a mortgage, and in the end wind up owning your own home free and clear!”

Who is David Bach?

Bach is a self-made millionaire who has written nine consecutive New York Times bestsellers. His book, “The Automatic Millionaire,” spent 31 weeks on the New York Times bestseller list. He is one of the only business authors in history to have four books simultaneously on the New York Times, Wall Street Journal, BusinessWeek and USA Today bestseller lists.

He has been a contributor to NBC’s Today Show, appearing more than 100 times, as well as a regular on ABC, CBS, Fox, CNBC, CNN, Yahoo, The View, and PBS. He has also been profiled in many major publications, including the New York Times, BusinessWeek, USA Today, People, Reader’s Digest, Time, Financial Times, Washington Post, the Wall Street Journal, Working Woman, Glamour, Family Circle, Redbook, Huffington Post, Business Insider, Investors’ Business Daily, and Forbes.

Bottom Line

Whenever a well-respected millionaire gives investment advice, people usually clamor to hear it. This millionaire gave simple advice – if you don’t yet live in your own home, go buy one.

Which Homes Have Increased in Value the Most?

Home values have risen dramatically over the last twelve months. The latest Existing Home Sales Report from the National Association of Realtors puts the annual increase in the median existing-home price at 5.6%. CoreLogic, in their most recent Home Price Index Report, revealed that national home prices have increased by 6.7% year-over-year.

CoreLogic broke appreciation down ever further into four price ranges which gives a more detailed view than simply looking at the year-over-year increases of the national median home price.

The chart below shows the four tiers and each one’s growth from July 2016 to July 2017 (the latest data available).

It is important to pay attention to how prices are changing in your local market. The location of your home is not the only factor in determining how much it has appreciated over the course of the last year. Lower priced homes have appreciated at greater rates than homes at the upper ends of the spectrum, due to demand from first-time home buyers and baby boomers looking to downsize.

Bottom Line

If you are planning on listing your home for sale in today’s market, find a local agent who can explain exactly what’s going on in your area and your price range.

More Than Half of All Buyers Are Surprised by Closing Costs

According to a survey conducted by ClosingCorp, over half of all homebuyers are surprised by the closing costs required to obtain their mortgage.

After surveying 1,000 first-time and repeat homebuyers, the results revealed that 17% of homebuyers were surprised that closing costs were required at all, while another 35% were stunned by how much higher the fees were than expected.

“Homebuyers reported being most surprised by mortgage insurance, followed by bank fees and points, taxes, title insurance and appraisal fees.”

Bankrate.com gathered closing cost data from lenders in every state and Washington, D.C. in order to share the average costs in each state. The map below was created using the closing costs on a $200,000 mortgage with a 20% down payment.

Keep in mind that if you are in the market for a home above this price range, your costs could be significantly greater. According to Freddie Mac,

“Closing costs are typically between 2 and 5% of your purchase price.”

Bottom Line

Speak with your lender and agent early and often to determine how much you’ll be responsible for at closing. Finding out that you’ll need to come up with thousands of dollars right before closing is not a surprise anyone is ever looking forward to.

Thinking of Selling your Home? Competition is Coming

The number of building permits issued for single-family homes is the best indicator of how many newly built homes will rise over the next few months. According to the latest U.S. Census Bureau and U.S. Department of Housing & Urban Development Residential Sales Report, the number of these permits were up 7.7% over last year.

How will this impact buyers?

More inventory means more options. Danielle Hale, Realtor.com’s Chief Economist, explained this is good news for the housing market – especially for those looking to buy:

“It’s not spectacular construction growth, but it’s slow and steady in the right direction. Eventually, the pickup in single-family home construction will mean [buyers] will have more options. Especially with the limited number of sales right now, more options are really needed.”

How will this impact sellers?

More inventory means more competition. Today, because of the tremendous lack of inventory, a seller can expect:

1. A great price on their home as buyers outbid each other for it
2. A quick sale as buyers have so little to choose from
3. Fewer hassles as buyers don’t want to “rock the boat” on the deal

With an increase in competition, the seller may not enjoy these same benefits. As Hale said:

“As new construction continues to increase, home shoppers will eventually have more [choices] and a bit more time to make purchase decisions compared to today’s quick-moving housing market.”

Bottom Line

If you are considering the sale of your home, it might make sense to beat this new construction competition to the market.

What to do in October Around Los Angeles County

Queen Mary’s Dark Harbor   Sept. 28-Nov. 1 Live your nightmares aboard the haunted Queen Mary and join our cast of ghouls, spirits, and undead for an unforgettable, frighteningly authentic haunted experience. Time/Place: See website for schedule. / The Queen Mary, Long Beach Contact: 877-342-0738 / www.thequeenmary.com Arcadia Oktoberfest   Sept. 30-Oct. 1 Get ready for authentic ‘fest games, music and, most importantly, delicious German eats and craft brew! Wunderbar! Time/Place: 11:30am-5:30pm / Santa Anita Park  Contact: www.santaanita.com Santa Clarita Comic & Toy Expo   Oct. 1 A variety of exhibitors will be on hand selling comics, toys, and everything else that a true comic and toy fan will ever need. Time/Place: 10am-5pm / College of the Canyons Valencia Campus Contact: 661-297-2215 / www.santaclaritacomictoyexpo.com Shriekfest Film Festival   Oct. 5-8 The Los Angeles Horror/SciFi Film Festival continues its tradition as Los Angeles’ Premier horror film event. Time/Place: 7-11pm / Raleigh Studios, Hollywood  Contact: www.shriekfest.com La Cienega Design Quarter’s Sidewalk Sale   Oct. 6-7 The same design shops and showrooms that sell to the top designers, collectors and celebrities, will be opening their doors, sidewalks and courtyards for an all-access shopping event. Time/Place: 10am-6pm / La Cienega Blvd., Los Angeles  Contact: www.lcdqla.com Classic Car Show and Drive-In Movie   Oct. 7 In the lead-up to Paramount Ranch’s 90th anniversary, the National Park Service will host a classic car show and drive-in movie showing of the ‘80s classic hit “Back to the Future.” Time/Place: 4-9pm / Paramount Ranch, Agoura Hills Contact: www.nps.gov/samo Westlake Village Century   Oct. 7 The Westlake Village Century 40, 100 and 15 mile rides are presented by Stonehaus. In addition to the rides, there will be live music, lunch, a beer and wine tasting expo and more. Time/Place: 7:30-11:30am / Westlake Village Inn Contact: www.westlakevillagecentury.com Bark at the Park   Oct. 7-8 Dog lovers and their friends: it is time for another round of canine capers at this annual event featuring vendor exhibits, fun games and activities for your playful pooch. Time/Place: 10am / Lancaster City Park  Contact: www.lancasterbarkatthepark.org Romanian Festival   Oct. 7-8 Two day celebration of Romanian Traditions with live entertainment, folklore dancing, and traditional food. Time/Place: 11am-6pm / Ernie Howlett Park, Palos Verdes Estates Contact: 510-274-0000 / www.romanianfestivals.com Oktoberfest on the Pier   Oct. 8 Special Olympics Southern California’s biggest FUNdraiser! Pacific Park rides, games, and prizes, Music and live entertainment, Arts & crafts and karaoke, Silent auction. Time/Place: 10am-2pm / Pacific Park/Santa Monica Pier Contact: www.sosc.org/pierdelsol Galpin Car Show   Oct. 8 1000 vehicles that will be on display including some from the Petersen Automotive Museum. Fun activities for kids like carnival games, paint-the-truck, live entertainment and delicious food. Time/Place: 10am-2pm / Galpin Motors, North Hills  Contact: www.galpin.com La Mirada Fall Festival   Oct. 12 Games, live entertainment, and dessert. The Festival is free to attend, and a donation of $2.75 is suggested for lunch provided by Cafe on the Green. Time/Place: 10am-12pm / La Mirada Activity Center  Contact: www.cityoflamirada.org Reyes Adobe Days   Oct. 12-15 Celebrates the very best of local culture with a variety of events for all ages on the grounds of an original 1845 California rancho. Time/Place: Reyes Adobe Historical Site, Agoura Hills Contact: 818-597-7361 / www.reyesadobedays.org German Current Film Festival   Oct. 13-16 Young, exciting & ground-breaking new cinema from Germany, Austria and Switzerland in Los Angeles. Time/Place: See website for schedule. / Egyptian Theatre, Los Angeles Contact: www.germancurrents.com The Belmont Shore Art Walk   Oct. 14 Will showcase the works of diverse artists who will use chalk as their medium, and the sidewalks of Belmont Shore as their canvas. Time/Place: 11am-4pm / Belmont Shore, Long Beach Contact: 562-434-3066 / www.belmontshore.org/art-walk Long Beach Oktoberfest   Oct. 14 With a focus on Fall/Oktoberfest craft beers, changes this year include a new “tasting” format, limited attendance, more beverage options and a new location. Time/Place: 12-4pm / The Pike Outlets  Contact: www.tasteofbrews.com OurTownLA Nonprofit Expo   Oct. 14 The purpose of this event is to allow the LA LGBTQ nonprofit groups listed on OurTownLA to promote themselves, the much needed services they provide and engage with the community. Time/Place: 12:30-4:30pm / Plummer Park, Fiesta Hall  Contact: www.ourtownla.org Pasadena ARTWalk   Oct. 14 The event highlights some of the best Southern Californian visual artists showcasing their work in painting, sculpture, watercolor, photography, mixed media, ceramics, jewelry, drawings, and printmaking. Time/Place: 11am-6pm / Pasadena Museum of California Art Contact: 626-568-3665 / www.pmcaonline.org Antelope Valley Fairgrounds Craft Fair   Oct. 14-15 A broad range of vendors will feature everything from handmade jewelry and food items, to decorative handbags and crocheted items to name a few. Time/Place: 8am-5pm / 2551 W Avenue H, Lancaster Contact: 661-948-6060 / www.avfair.com Stop Cancer 5/10K Run/Walk   Oct. 15 Enjoy a fast, flat course with chip timing and finish line video. Quality t-shirts. Finisher medals for all participants. Time/Place: 6:30am-12pm / Woodley Park, Encino Contact: www.stopcancerrunwalk.org Sherman Oaks Street Fair   Oct. 15 200 + vendors sponsored, Car Show, Pet Expo, Main Stage featuring Chord Overstreet, Community Stage, Carnival, Chamber Bar, Food Trucks. Time/Place: 10am-6pm / Ventura Blvd.: Van Nuys to Kester Contact: 818-906-1951 / www.shermanoaksstreetfair.org City of Westlake Village City Celebration   Oct. 21 White Oak Elementary Family Festival, food trucks, craft beer, wine, Haunted House, Trick-or-Treat Trail, displays and activities, local community performance showcase, magic show, a shredding and e-waste collection event and more. Time/Place: 3-8pm / Westlake Village Civic Center Contact: 818-706-1613 / www.wlv.org/citycelebration Into the Blue, LA Fashion Gala   Oct. 21 Enjoy a glamorous evening highlighted by an inspired cocktail hour, designer runway show by ESCADA, and auction fun in support of the Autism Speaks Southern California Chapter. Time/Place: 6:30-10pm / Union Station, Los Angeles Contact: www.autismspeaks.org/intotheblue Arturo Sanchez Sr., Halloween Parade   Oct. 21 Marching bands from throughout the southland are expected to perform alongside ghosts and goblins of all kinds. Time/Place: 11am / Norwalk/Mapledale to Hermosillo Park Contact: 562-929-5702 / www.ci.norwalk.ca.us Calabasas Pumpkin Festival   Oct. 21-22 Live bands, contests, reptile and wildlife shows, inflatable rides and giant slide and youth carnival games. Pumpkin patch, pumpkin foods and flavors, pumpkin beer and more. Time/Place: 10am-5pm / Juan Bautista de Anza Park Contact: 818-222-5680 / www.calabasaspumpkinfestival.com American Indian Celebration   Oct. 21-22 Native music, art, dancing, storytelling, and food. Time/Place: 11am-4pm / Antelope Valley Indian Museum, Lancaster Contact: 661-946-3055 / www.avim.parks.ca.gov Clean Food Fest + Clean Made Market   Oct. 21-22 A lifestyle event, digital platform, and national brands in the health, wellness, and sustainable product tasting and shopping opportunities-all in one weekend! Time/Place: 11am-6pm / California Market Center, Los Angeles Contact: www.cleanfoodfest.com Oktoberfest DTLA   Oct. 21-22 Beer Garden, sausages, pretzels, authentic desserts and of course live music and dancing. Time/Place: 12-8pm / Pershing Square, Downtown L.A. Contact: 310-404-3094 / www.oktoberfestdtla.com Fireball Tim’s Wheels & Waves Classic Car   Oct. 22 Families, kids, and guests of all ages are invited to enjoy vintage, exotic, and rare cars of all types. Time/Place: 7-9am / Malibu Country Mart  Contact: www.fireballtim.com Denim, Diamonds & Stars for Autism   Oct. 22 VIP & general cocktail reception, silent & live auctions, live entertainment, seated gourmet dinner, celebrity presenters, live entertainment, and a special tribute to 2017 honorees. Time/Place: 4:30-9:30pm / Four Seasons Hotel Westlake Village Contact: www.denimanddiamondsforautism.net Abilities Awareness Faire   Oct. 24 Recreational activities; entertainment; food; and exhibitor tables. Local organizations and businesses serving people with disabilities are invited to showcase your services. Time/Place: 12pm / 7630 Washington Ave., Whittier Contact: 562-567-9480 / www.cityofwhittier.org Historical Cemetery Tour   Oct. 28 Period costumes worn by all the performers further heighten the experience with an aura of authenticity. The tour is appropriate for families and all ages. Time/Place: Long Beach Municipal & Sunnyside Cemeteries, Long Beach Contact: www.hslb.org/historical-cemetery-tour Woodland Hills Halloween Family Faire   Oct. 28 Enjoy a variety of activities for children of all ages including: pumpkin painting, face painting, games, bounce houses, arts and crafts, exhibitors, food trucks, entertainment and more. Time/Place: 10am-5pm / Warner Center Park  Contact: www.halloweenfaire.org Model Train Show   Oct. 28 Come see remarkable moving miniatures by the region’s most acclaimed enthusiasts. “How To” clinics will be held throughout the day. Time/Place: 10am-5pm / South Coast Botanic Garden, Rancho Palos Verdes Contact: 310-544-1948 / www.southcoastbotanicgarden.org Youth Halloween Carnival   Oct. 28 With so much fun stuff to do! There will be face painting, game booths, and costume contests too! Time/Place: 2-5pm / Plummer Park, West Hollywood  Contact: www.weho.org Pugtacular Spooktacular   Oct. 28 Dog costume contest, vendors, food, photo booth, adoptions, silent auctions and great raffle prizes. Time/Place: 11am-4pm / Torrance Park: 2001 Santa Fe Ave. Contact: 310-327-7871 / www.pugnationla.org Camp Flog Gnaw Carnival   Oct. 28-29 Annual music festival and carnival created and hosted by Tyler, The Creator. Features various carnival games, well known artists, restaurants, and a ferris wheel. Time/Place: Exposition Park, Los Angeles  Contact: www.campfloggnaw.com Alzheimer’s Greater L.A. walk4ALZ   Oct. 29 Families, friends, caregivers and people living with the disease will walk side by side with teams from the community to raise awareness and much needed funds. Time/Place: 8:30-11am / Century Park, Los Angeles  Contact: www.alzgla.org Trick Or Treat On 2nd St.   Oct. 31 Grab a bag and come show off your costumes in return for some serious candy loot! Time/Place: 4-6pm / Belmont Shore, Long Beach  Contact: www.belmontshore.org Trunk or Treat Halloween Spectacular   Oct. 31 Parents dress up those little monsters in their Halloween costumes and bring them out for some trick-or-treating fun! Time/Place: 3-5pm / Agoura Hills/Calabasas Community Center Contact: 818-880-2993 / www.ahccc.org La Mirada Halloweenfest   Oct. 31 Maze, trick-or-treat area, games, and costume contests! Time/Place: 4:30-8pm / Neff Park: 14300 San Cristobal Drive Contact: 562-943-7277 / www.cityoflamirada.org